Published by: Business desk
Last updated: Sep 18, 2023 4:56 PM IST
The rupee depreciated for the fourth day in a row on Monday, settling 13 paise lower at a lifetime low of 83.29 (provisional) against the US dollar, mainly due to risk aversion in global markets and rising prices for crude oil.
Additionally, a strong US currency against key foreign rivals and a negative trend in domestic stocks weighed on investor sentiment, according to forex traders.
At the interbank foreign exchange market, the domestic currency opened at 83.09 against the dollar and traded between 83.09 and 83.30 against the dollar.
The rupee eventually closed at a record low of 83.29 against the dollar, registering a decline of 13 paise from its previous close.
On Friday, the rupee fell by 13 paise to settle at 83.16 against the US dollar.
The dollar index, which measures the greenback’s strength against a basket of six currencies, fell marginally 0.11 percent to 105.20.
Brent crude futures, the global oil benchmark, traded 0.42 percent higher at $94.32 a barrel.
Ahead of the holiday, the rupee closed at a new low following risk-averse sentiments and a rally in crude oil prices, said Dilip Parmar, Research Analyst at HDFC Securities.
“This week will remain highly volatile following a series of central bank interest rate meetings in developed and emerging market economies. The bottom line is that the dollar will maintain its strength throughout the week,” Parmar said.
In the near term, the spot USD/INR is expected to cross the record high and could reach a level of 83.50 to 83.70, while it could hold the support at 83, Parmar added.
On the domestic equity market front, the BSE Sensex closed 241.79 points or 0.36 per cent lower at 67,596.84 points, while the broader Nifty fell 59.05 points or 0.29 per cent to end at 20,133.30 points.
Forex traders said the rupee’s depreciation can be attributed to several factors, including high crude oil prices, strong US dollar, foreign fund outflows and widening trade deficit.
India’s exports fell 6.86 percent to $34.48 billion in August this year from $37.02 billion in the same month last year, government data showed on Friday.
Imports also fell by 5.23 percent to $58.64 billion, compared to $61.88 billion in August 2022.
Meanwhile, India’s foreign exchange reserves fell by $4.992 billion to $593.904 billion in the week ended September 8, the Reserve Bank of India said on Friday.
In the previous reporting week, the pot rose by $4.039 billion to $598.897 billion.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed – PTI)